Signum Smart Tokens and Native Liquidity Pools

Signum
Signum
Oct 25, 2021 · 6 min read
Smart Token & NPL

Signum is the pioneer of truly sustainable, decentralized blockchain solutions, an alternative to wasteful Proof of Work and centralized Proof of Stake systems. First developed in 2014, Signum has been at the forefront of blockchain technology with the first implementation of smart contracts. Since 2019, the Signum-Network has been preparing the Signum blockchain for the next decade.

Tokens

Most platforms use smart contracts to handle token creation and related servicing activities such as buying, selling, and transferring. Signum uses a distinctly different approach to its token economics. Signum tokens are distinct entities that are positioned similarly to Signa, the Signum network’s native coin. Because Signum tokens are directly attached to accounts, they can be transferred and traded directly. They are not handled indirectly via a smart contract.

Signum’s token architecture also includes integration with a built-in exchange that allows anyone to place buy and sell orders for any Signum token. Tokens orders are priced in Signa.

The creation of Signum tokens is quite simple. It is only necessary to specify the token’s ticker symbol, its total supply, and the number of digits in most cases. After executing the token creation command, the newly created tokens are immediately available in the token creator’s wallet.

The transaction fee to create a token series is just 110.25 Signa, which is around 1$ as of the date of this article. A convenient way to issue tokens is via BTDEX.

Creating a token on Signum is a one-click deployment.

New Developments for Signum tokens coming in Q4/2021!
The existing features and functionality of Signum tokens are already superior to other implementations such as Ethereum, Tron, or Binance Smart Chain. However, the latest Signum hard fork created new opportunities for Signum to expand its already impressive token architecture base in the form of Smart Tokens and Native Liquidity Pools. This new functionality will be added in Q4/2021.

Smart Token

The next step in Signum’s token evolution will be Smart Tokens. These tokens will have more functionality on the chain and will be able to interact with smart contracts. Specifically, the new tokens will have the following new features:

  1. Mintable
  2. Burnable
  3. Integration with smart contracts
  4. Integration with native liquidity pools

Mintable

Signum tokens are currently created with a fixed supply set at the time a token is created. This fixed supply is currently immutable after a token is created. With the upcoming development, the token creator will have the additional option to make the token mintable and to set a floating cap on the supply.

Burnable

The current tokens on Signum cannot be burned. With this new option, the creator of a token will have the option to make the token burnable. If this feature is activated, any token holder can burn their token balance.

Integration with smart contracts

The upcoming new smart contract framework will be able to interact with both regular tokens and smart tokens. This will open the Signum chain for many new use-cases as Signum’s smart contracts will be able to receive and send tokens or distribute Signa to current token holders.

Integration with native liquidity pools

Since its creation, Signum has had an integrated token exchanged based on the order book model. This model allows buyers and sellers to place orders for a given token priced in Signa as a basic function. It also provides for Initial Exchange Offerings (IEO). Order books are complex to handle, but the Signum chain does this effectively and efficiently. Liquidity pools are the next generation of DEXs, and this model will also be available on the Signum chain in a native form.

Native Liquidity Pools

On blockchains like Ethereum or BSC, everything is set up as a smart contract. As a result, it is challenging to deploy the complex code, and difficult to audit it for bugs, backdoors, or other items requiring due diligence.

Signum will follow a much more efficient and trustless method. The liquidity pools will be native to the blockchain (integrated into the code). As the Java code to be used is open-source, it will be accessible for anyone to audit.

The integration of the liquidity pools will be supported by new transaction types that make it possible for anyone to create a pool, add or remove liquidity, or swap tokens on those pools. Also, with the roll-out of Smart Tokens, the handling of liquidity pool shares will be revolutionized on the Signum chain.

Instead of handling the balances for each liquidity provider within a smart contract, each addition of liquidity will give the liquidity provider pool-tokens to represent their pool share. As these are smart tokens, are fungible, can be integrated with smart contracts, and can be traded on the integrated token exchange, many additional use-cases will be possible. If a liquidity provider wants to remove their liquidity from a pool, they can simply send the token balance back to the pool to receive back their share in tokens and/or Signa.

Solving the sandwich attack

The sandwich attack, described in detail in this medium article DEFI Sandwich Attack Explain by the author achinta das, has been known in the DeFi community for years. So far, it has not been solvable because most current setups are based on smart contracts.

Signum will provide a solution for this attack vector through the setup and logic of the liquidity pools. This will be integrated within the code (node) that a miner uses to forge block with the included transactions.

What will the solution look like?

In short, all transactions interacting with a liquidity pool in a given block will be subject to the following verifications:

  • First, all transactions providing liquidity will be performed.
  • Second, all transactions removing liquidity will be performed.
  • Third, all swap transactions will be applied together, all with the same rate (price).

The third step will make the DeFi sandwich attack impossible.

Note: We will have a dedicated article in the near future describing this new logic.

Conclusion

The latest hard-fork Speedway was the groundwork needed to catapult Signum into the league of top blockchains in the DeFi area. The Signum-Network team is currently developing the necessary protocol changes for Smart Tokens and Native Liquidity Pools with a target of Q4 2021 for implementation. More technical articles about the integration will follow. Stay tuned.

Discover Signum

Signum is the world’s first truly sustainable blockchain, featuring world-class applications on a sustainable leading-edge blockchain architecture. Compared to other cryptocurrencies, Signum powers its native cryptocurrency Signa (SIGNA) with a minor fraction of the energy use and e-waste. Signum empowers users and developers around the world with innovative blockchain solutions for everyday life.

SNA is a Swiss Not-for-Profit Organization founded in 2021 to provide a solid foundation for Signum to grow and fulfill its vision of sustainability and innovation in blockchain technology.

Find out more at https://signum.network/ or join a Signum channel below.

Download BTDEX: https://www.signum.network/wallet.html
Get Signa: https://signum.network/exchanges.html
Pancake-LP : WBNB/WSIGNA or USDT/WSIGNA

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Signum is the foundation for our sustainable future. It’s easily accessible to everyone and as a customizable platform, it has the power to feature unstoppable and censorship-resistant decentralized applications.